Encouraging Electric Cars To Accelerate Zero Carbon Emissions, Observer Assesses The Need of Fiscal Policies To Make The Price More Affordable For The Community

JAKARTA - The government has committed to reducing emissions through the ratification of the Paris Agreement which requires Indonesia to reduce greenhouse gas emissions by 29 percent with its own efforts and 41 percent with international assistance by 2030.

In addition to the commitment in the NDC, the Indonesian government is also committed to achieving net-zero emissions (NZE) by 2060 to come.

Energy Watch Executive Director Mamit Setiawan said that one of the efforts to achieve this target is to increase the population of electric cars in Indonesia. By increasing the use of electric cars, several benefits will be created for Indonesia.

"Through an increase in the population of electric cars, we can reduce greenhouse gas emissions significantly. If there are no efforts to reduce the population of conventional cars, the transportation sector will contribute 0.28 billion tCO2e/year and 0.86 billion tCO2e/year by 2060," said Mamit in his written statement to VOI, Monday, April 4.

Therefore, there is a need for strong support from the government so that the number of electric cars continues to increase. The problem with electric cars today, according to him, is the price is still expensive and the design is not yet in demand by the Indonesian people who prefer MPV and can accommodate a large number of passengers.

"There needs to be a fiscal policy so that electric cars can become more affordable for the public. In addition, if possible, the government can provide a stimulus for people who will buy electric cars so that it is more attractive to use electric cars," he concluded.

Mamit detailed, 1 liter of fuel with a distance of 10 km will produce 2.6 kg of CO2, while for 1 kWh an electric car with a distance of 10 km produces 1.27 kg of CO2.

"Apart from producing less CO2 emissions, the cost for 1 kWh is only IDR 1.500, equivalent to 1 liter of fuel for IDR 12.500. So, the price is cheaper and people can save more," said Mamit.

In addition, Mamit also explained another benefit of increasing the population of electric cars, namely it can reduce the import of fuel which is currently very significant in number.

"With the increase in electric cars, we can reduce the import of fuel, both product, and oil, where currently the gap is very large. Currently, domestic oil production is only around 700 thousand Barrels of Oil Per Day (BOPD), while national fuel consumption has reached 1.4 million BOPD. This will increase the trade balance deficit wider," explained Mamit

Mamit also said that this very large import of fuel could depress the rupiah against the US dollar and could also cause inflation due to the increase in the price of goods due to the weakening of the rupiah.